OPEC cuts oil demand forecast for second quarter due to Iran war

OPEC has lowered its forecast for global oil demand in the second quarter by 500 thousand barrels per day, according to the cartel's monthly report. World demand for oil in the second quarter is now estimated at an average of 105.07 million barrels per day against 105.57 million barrels in the previous forecast.

"The demand growth forecast for the second quarter of 2026 is revised downward for both OECD (US, Japan, EU countries, South Korea, Canada, Australia, etc. - Oninvest) and non-OECD countries - mainly due to a temporary weakening of demand dynamics amid ongoing developments in the Middle East," OPEC said in the report.

At the same time, OPEC kept unchanged its forecast of growth in global oil demand for the whole of 2026 at the level of 1.38 million barrels per day, in contrast to the US Energy Information Administration (EIA). It cut its estimate in half in an April 7 report. The OPEC report is the first public assessment of the impact of the war with Iran on the market, Reuters explains.

On April 5, OPEC+ countries agreed to increase production quotas by 206 thousand barrels per day in May. However, this increase remains largely formal, as the key participants are unable to increase production due to the actual blockage of the Strait of Hormuz, notes Reuters. The OPEC report shows how much production has fallen since the conflict with Iran began in late February, the agency emphasizes. According to independent sources cited by OPEC, OPEC+ oil production in March amounted to 35.06 million bpd, down 7.7 million bpd from February. Iraq and Saudi Arabia accounted for the largest reduction.

This article was AI-translated and verified by a human editor